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Design-2-cost: wie Innovations-Spinner mit Controlling-Freaks Frieden schließen

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Vortrag von Robert Schwegler (Deutsche Telekom AG) am Corporate Startup Summit 2015.

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Design-2-cost: wie Innovations-Spinner mit Controlling-Freaks Frieden schließen

  1. 1. DESIGN-TO-COST: WIE INNOVATION- SPINNER MIT CONTROLLING-FREAKS FRIEDEN SCHLIESSEN.FRIEDEN SCHLIESSEN. “THINK BIG, START SMALL, MODIFY FAST” DTAG, Robert Schwegler Bonn, Darmstadt, 07.07.2015
  2. 2. THE 4Q MODEL: WHAT IS IT? WHERE FROM? ? 1. Optimization initiative Express48 EOY2013, 48 interviews working & mgmt level 2. 4Q Pilot: 4 projects, one cancelled 3. 4Q Steering: promoted within CFO’s Design2Cost initiative as Process Innovation 2
  3. 3. THE 4Q MODEL: DESIGNING AND DEVELOPING CUSTOMER’S MOST DESIRED PRODUCTS AT OPTIMIZED COSTS. BENEFITS 1. Guide for the product development process, well fitting to our existing Agile approach 2. Focus: efficient and rapid development, acceleration of Time-2-Market, Feature- management and fast customer feedback 3 3. Incorporate: Target Costing/ Design to Value principles 4. Criteria to right size investments along all phases of the product lifecycle 5. The Minimal viable product (MVP) is the starting point of the 4Q model.
  4. 4. DESPITE FREQUENT USE OF SYNONYMS, THERE ARE DEMARCATIONS TO D2C AND D2V Target Costing (TC) Design to Cost (D2C) Design to Value (D2V) „Designand constructproductsfollowing„Designand constructproductsfollowing„Designand constructproductsfollowing„Designand constructproductsfollowing costpointaspects“costpointaspects“costpointaspects“costpointaspects“ „What is a productallowedto cost?“„What is a productallowedto cost?“„What is a productallowedto cost?“„What is a productallowedto cost?“ „Designand constructproductsfollowing„Designand constructproductsfollowing„Designand constructproductsfollowing„Designand constructproductsfollowing customer needs“customer needs“customer needs“customer needs“ 4 Guiding approach: Minimal viable product (MVP) minimal viableMVP Low-quality products, that either don‘t work or nobody needs Products that well-funded companies can afford to create by doing a lot of market research and R&D A quick,but usefull product you can create, beforeexhaustingressourcesand confidence
  5. 5. HIGH Customer Value NO VALUE (BELOW THE MINIMUM VIABLE PRODUCT THE 4Q MODEL FOCUSES ON DESIGNING THE MVP USING D2V / D2C PRINCIPLES FOR FURTHER INVESTMENTS BAD VALUE/COST RATIO AREA Details on MVP DESIGN TO VALUE (D2V) AREA 4Q Model Idea: Categorizingof developmentand operationsCategorizingof developmentand operationsCategorizingof developmentand operationsCategorizingof developmentand operations to speed-up time-2-market The MVP is the startingpointMVP is the startingpointMVP is the startingpointMVP is the startingpointof the 4Q model All additional investments are tightly bound to D2C/D2V following the MVP approach. The minimum viable product is that version of a new product which allows a team to collect thecollect thecollect thecollect the maximumamount of validatedlearningmaximumamount of validatedlearningmaximumamount of validatedlearningmaximumamount of validatedlearningabout customers with the least effortwith the least effortwith the least effortwith the least effort An MVP is notis notis notis not a minimal product - it is a strategy and process directed toward making and selling a product to customers It is an iterativeprocessiterativeprocessiterativeprocessiterativeprocessof idea generation, prototyping, presentation, data collection, analysis and learning. LOW PRODUCT FEATURE SET) 5 # Features Quelle:hillerassociates.com,wikipedia THE TELEKOM 4Q MODEL Details on MVP
  6. 6. 4Q MODEL: CATEGORIZING DEVELOPMENT AND OPERATIONS TO SPEED-UP TIME-2-MARKET Details Q1:Q1:Q1:Q1: Teams have the option to develop agile new offers and pre-test them in small test market Q2:Q2:Q2:Q2: Mass marketable implementation on pilot experience in Q1 Q3:Q3:Q3:Q3: Risk minimized changes on platform components Q4:Q4:Q4:Q4: Small adjustments to customer feedback will be quickly implemented automated provided. 4Q Model PROJECTMAINTENANCE FRONTEND Lowimpact Prototyping Adaptions/ Configuration/ Customizing 6 Efficient and rapid development Support of the "fail fast, fail cheap“ principle Acceleration of Time2Market by categorizing work Fast customer feedback Simple integration of partners (e.g. best shoring in Q2) Incentives for lean development (avoiding overhead, agile approach) Targets / AdvantagesQ1Q1Q1Q1 Q2Q2Q2Q2Q3Q3Q3Q3 Q4Q4Q4Q4 FRONTENDBACKEND (Platform) Highimpact Adjustments of platform Project work Opex Capex
  7. 7. 4Q MODEL: CATEGORIZING DEVELOPMENT AND OPERATIONS TO SPEED-UP TIME-2-MARKET : TRANSITIONS WITHIN 4Q Details on transitions4Q Model PROJECTMAINTENANCE FRONTEND Lowimpact Prototyping Adaptions/ Configuration/ Customizing 1 Fail fast, fail cheap 3 2 4 Drop product idea Learn about product potential with minimal investment3 New product Complex new function/feature2 Small Changes on existing products Bug fixing1 7 Q1Q1Q1Q1 Q2Q2Q2Q2Q3Q3Q3Q3 Q4Q4Q4Q4 FRONTENDBACKEND (Platform) Highimpact Adjustments of platform Project work Opex Capex fail cheap 5 6 7 Customization leads to core adjustments Typical implementation duration per feature: days7 Ensure high quality and implement further user requests Typical implementation duration per feature: weeks6 Plan further investment steps based on successful prototype Typical implementation duration per feature: Months5 Initial take over of parts of innovation into existing product(s) Typical implementation duration per feature: days4
  8. 8. 4Q MODEL: CATEGORIZING OF DEVELOPMENT AND OPERATIONS TO SPEED-UP TIME-2-MARKET 4Q Model PROJECTMAINTENANCE FRONTEND Lowimpact Fail cheap, fail fast! Fast development teams, low SLA, low volume traffic, throw-away prototypes UI-driven innovation on available APIs Extension of server-side functionality Runs in agile scrum contracting mode Gathers requirements for heavier backend implementations Restricted resources (no sustained eng.) Pilots/prototypes need to be handed over to Q2 or be killed Fast customer feedback loops Small changes with local impact only (no cross dependencies on sub- systems) with local & risk based testing High deploy frequency Fast & automated release cycles Typical changes: Mainly FrontEnd (UI) changes for market adaptations Sustained Engineering (minor changes) Market local extensions with configuration 8 Q1Q1Q1Q1 Q2Q2Q2Q2Q3Q3Q3Q3 Q4Q4Q4Q4 BACKEND (Platform) Highimpact Pilots/prototypes need to be handed over to Q2 or be killed High quality implementations with input from requirements gathered in Q1 Some key project people will move to guide product stream development (Q3) Clear contracting to multiple API users/providers and quality pre-announced changes to them (capacity management) Model seamless migrations on incompatible changes between sub-systems Ability to steer off-shore with running fully functional prototype Market local extensions with configuration Market local customization implemented at predefined customization hooks resulting in direct feedback for Q3 Sustained Engineering Mainly Resource Facing Systems Fast cycles for bug-fixes and minor adaptations avoiding system inconsistencies No dependencies Supports enhancements and maintenance
  9. 9. CONTEXT OF LIFE CYCLE, 4Q-MODEL AND DESIGN TO … Sales Time Introduction Growth Maturity DeclineLife Cycle Product/ Feature 4Q Focus 9 Development of a Minimal Viable Product (MVP) with focus on time-to-market. Maximize variabilization of costs along customer line. Introduction of new features along D2V criteria and optimization of product development costs. (Profitably) Maximize Revenue. Product lifecycle management. Customer experience benchmarking and continuous monitoring of cycle. maximize EBITDA/EBIT … Value … Cost + Value … Cost + Value Liquidate product Beware of expensive ‘turn around plans’. Deliver cash, otherwise liquidate. … Cost Product Financial Design to … Target Price n/a Extractable/Available Available Available
  10. 10. THANK YOU!

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